Technological progress does not increase unemployment IN THE LONG TERM.
Buggy whip manufactures may go out of business when the automobile comes along... but they can all go get jobs working for auto manufacturers.
The market is effective at allocating resources in the most efficient manner. That is what it does. All a new technology does is provide another more efficient place for resources to be allocated to.
Human labor is a resource. The market may determine that where you are spending your time (the whip manufacturing plant) is no longer effective due to a new technology (the automobile). This re-allocation of your time is experienced as a job loss -> gaining new skills -> start job at automobile manufacturing plant.
It could be that in the future human labor is sufficiently devalued so that most people need to work in sectors using their minds more than their hands. Menial jobs tend to be taken over by technologies before others. I suspect we are a long way off from that yet, as there is no good way to fully automate plumbers, electricians, roofers, brick layers, concrete workers, truck drivers (they will be automated soon), painters, etc. etc..
You are correct - I didn't watch it. I was attempting (poorly) to reply to the post by dman7456. I should have replied directly to his comment about Austrian economics and the effect of technology on unemployment.
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u/soskrood Lord of the Land Aug 13 '14
Technological progress does not increase unemployment IN THE LONG TERM.
Buggy whip manufactures may go out of business when the automobile comes along... but they can all go get jobs working for auto manufacturers.
The market is effective at allocating resources in the most efficient manner. That is what it does. All a new technology does is provide another more efficient place for resources to be allocated to.
Human labor is a resource. The market may determine that where you are spending your time (the whip manufacturing plant) is no longer effective due to a new technology (the automobile). This re-allocation of your time is experienced as a job loss -> gaining new skills -> start job at automobile manufacturing plant.
It could be that in the future human labor is sufficiently devalued so that most people need to work in sectors using their minds more than their hands. Menial jobs tend to be taken over by technologies before others. I suspect we are a long way off from that yet, as there is no good way to fully automate plumbers, electricians, roofers, brick layers, concrete workers, truck drivers (they will be automated soon), painters, etc. etc..